Whether it’s a show of defiance, relief over the lack of renewed terror attacks, or a genuine sentiment improvement, stock markets are staging a powerful rally.

Trading opened at 9:30 ET as usual in Toronto, with the Nasdaq opening at 11:00 ET, and the NYSE at 12:00 ET. The S&P/TSX index is up 76 points at midday to 6,620.

Volume has been predictably low, at least until the U.S. markets opened, with just 50.7 million shares changing hands. Up volume is overwhelming the down volume by a margin of three to one. Market breadth is also very bullish, with winners trumping losers by 11:6.

Every sector is up today on the TSX, apart from the safe haven gold stocks. The broad rally has pushed golds down 2.3%.

There are strong gains in tech stocks, up 3.7%, after analysts raised estimates on Nokia Oyj. Consumer stocks are up, financials are powering 1.5% higher, and there are strong gains in diversifieds, health care and industrials. Strong capacity utilization numbers this morning also boosted the recovery picture in Canada.

Bombardier is leading the blue chip rally today, up almost 3%, with more than 5 million shares traded. BCE is up, as is Alcan, Teck, Rogers Westaim and Jean Coutu.

The banks are a powerful force on the upside today, with TD leading the way, up 1.8%. There are also notable gains in CIBC, Royal Bank, Bank of Montreal and Manulife Financial.

Tech stocks are stronger, driven by gains in Research in Motion, Celestica, ATI, Wireless Matrix and Ballard Power.

All of this buying is coming at the expense of the gold group, as traders abandon safety for optimism. Kinross is down more than 5%, and there are similar drops in Kinross, Glamis, Goldcorp and Blackrock Ventures.

In business news, AT & T Canada announced that it has elected not to make bond interest payments totaling approximately US$47.8 million, due on Sept. 15, and approximately US$5.4 million due on Sept. 23. It says that it is in constructive discussions with bondholders, its bank syndicate, and AT & T Corp. to restructure its public debt.

In New York, the belated market opening came with an aggressive rally. The Dow gained 124 points to 8,726. The S&P 500 is up 12 points to 922. Nasdaq has added 24 points to 1,344.

The S&P/TSX Venture index has joined the rally too, gaining eight points to an even 1,000. Volume is on the low side at 11.6 million shares. 701 Media Group is the top trader of the day, down a penny to 5¢ on 1.65 million shares.